9911796707
TMI Blog1960 (11) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... favour of the respondent - - - - - Dated:- 30-11-1960 - Judge(s) : J. L. KAPUR., M. HIDAYATULLAH., J. C. SHAH JUDGMENT The judgment of the court was delivered by KAPUR, J.---These appeals are brought by the assessee company against a common judgment and order of the Punjab High Court by which four appeals were decided in Civil Reference No. 6 of 1953. The appeals relate to four assessment years, 1947-48, 1948-49, 1949-50 and 1950-51. Two of these assessments, i.e., for the years 1947-48 and 1948-49, were made on the appellant as successor to the two limited companies hereinafter mentioned. Briefly stated the facts of the case are that the appellant company was incorporated in the year 1947. Its objects, intet alia, were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce sheet. The Income-tax Officer, however, disallowed and added back the amount so received to the income returned by the appellant. Against these orders appeals were taken to the Appellate Assistant Commissioner who set aside the additional assessments made under section 34 in regard to the assessment years 1947-48, 1948-49 and 1949-50 and the fourth appeal in regard to the year 1950-51 was decided against the appellant. Both sides appealed to the Income-tax Appellate Tribunal against the respective orders of the Appellate Assistant Commissioner and the Tribunal decided all the appeals in favour of the appellant. It was held by one of the members of the Tribunal that the amounts received as entrance fees were intended to be and were in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount received as membership fees was shown as capital in the books of the company and there was no periodicity and therefore the amounts which had been treated as income should have been treated as capital receipts and therefore exempt from assessment. It was firstly contended that the question did not arise out of the order of the Tribunal and that a new question had been raised but the objection is futile not only because of the absence of any such objection at the stage of the drawing up of the statement of the case but also because of failure to object in the High Court ; nor do we see any validity in the objection raised. That was the only matter in controversy requiring the decision of the court and was properly referred by the Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant company, its memorandum and articles of association and the rules made for the conduct of business. The appellant company was an association which carried on a trade and its profits were divisible as dividend amongst the shareholders. The object with which the company was formed was to promote and regulate the business in shares, stocks and securities etc., and to establish and conduct the business of a stock exchange in Delhi and to facilitate the transaction of such business. The business was more like that in Liverpool Corn Trade Association v. Monks. In that case an association was formed with the object of promoting the interest of corn trade with a share capital upon which the association was empowered to declare a dividend. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from a dealing with its own shareholders in a line of business which is restricted to the shareholders." In Commissioner of Income-tax v. Royal Western India Turf Club Ltd. this court rejected the applicability of the principle of mutuality because there was no mutual dealing between members inter se. There was no putting up a common fund for discharging a common obligation undertaken by the contributors for their mutual benefit and for this reason the case decided by the House of Lords in Styles v. New York Life Insurance Company was held not applicable. In the present case the memorandum of association shows that the object with which the company was formed was to promote and regulate the business of exchange of stocks, shares, debe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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